It's fascinating to watch Amazon's strategy in its battle with Apple. Amazon reported a staggering 73 percent drop in income with the sales of its recession-friendly Kindles. Amazon makes the tablet price cheap, the Kindle Fire is actually selling for less than it costs to manufacture it.
The Kindle is good value in recessions because it's selling for as low as $79.
Amazon's strategy of course is to say it's okay to lose money now, as long as we get the product out, we can make up for it at the other end. Leaked figures show that the Kindle is now the jewel in the crown of Amazon's empire and could eventually outsell the iPad2.
Amazon's push into publishing will create even better margins on its e-book sales.
The battle lines with Apple have been drawn.
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